How Outsourcing Customer Support Can Help Reduce Cancellation Rates

Order cancellations are eating into your profits. Consider how much time and money you’ve spent on refunds and returns this year. Every cancellation hurts—not just your revenue, but also your customer relationships and growth potential.

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The worst part? Whether the customer cancels or you do, the outcome is the same: you lose a sale, and they lose trust. High cancellation rates cost eCommerce businesses billions annually, but they’re not inevitable. So, why do cancellations happen? And why do they result in billions of losses for retail businesses? 

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In this article, we will dig into the origins of the eCommerce version of the “cancel culture” and how you can reduce cancellation rates by outsourcing customer support services.

What is the Order Cancellation Rate?

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Order cancellations happen when either the customer or the seller cancels an order before it’s fulfilled or shipped. Your Order Cancellation Rate (OCR) is a key metric that reflects how often this happens. It’s calculated as:

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OCR = (Number of Canceled Orders / Total Orders) × 100%

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Typically, OCR includes only post-purchase cancellations before delivery. However, abandoned carts can also be seen as cancellations, affecting revenue just as much. Depending on their policies, some platforms can classify post-payment or in-transit cancellations under this metric.

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Why does this matter? A high cancellation rate can signal a poor customer experience, fulfillment issues, or a lack of proactive support are all problems that can lead your customers straight to competitors.

How Does High Order Cancellation Influence Your Business?

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Order withdrawals are a challenge that eCommerce businesses cannot afford to overlook. While a few missed sales each month might seem insignificant, over time, high OCR can have a lasting impact on your business’s profitability, reputation, and growth.

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The most immediate consequence is a decline in revenue. Some cancellations may involve unfinished orders – abandoned carts, so to speak. Others, on the other hand, may include full refunds for already purchased items, directly cutting into your profits. Additionally, high cancellation rates can undermine your marketing efforts. When money is spent on customer acquisition without a return on investment, advertising budgets quickly disappear, limiting future growth opportunities.

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Beyond financial losses, frequent cancellations can even damage your brand’s reputation. People who cancel rarely do so when they are fully satisfied, and with a large number of withdrawn orders, your business is more likely to receive lower review ratings. This, in turn, affects customer retention and reduces loyalty, making it increasingly difficult to attract new buyers.

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Perhaps one of the most critical risks of high order cancellations is an elevated dispute rate. This can lead to severe consequences, such as suspending or closing your PayPal or other payment processing accounts. Without this asset, you won't be able to process even fully completed purchases. 

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Given the significant impact of cancellations on an eCommerce business and its future revenue, it’s hard to deny that keeping rates low is a basis for an up-and-running company. So, let’s look deeper into the key reasons behind cancellations and look into some actionable strategies to minimize them.

Why the Orders Get Cancelled

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Order cancellations can occur at various points in the customer journey, primarily falling into two categories: pre-purchase and post-purchase. Understanding the differences between these stages is essential for eCommerce businesses, as it allows for building tailored strategies to address the unique challenges at each point in the buyer’s journey.

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1. Pre-Purchase Cancellations:

During the pre-purchase stage, potential customers may abandon their purchase due to a lack of trust or clarity. Common triggers here include:

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• Unexpected change in pricing (e.g., advertising a monthly subscription as $2.99 but including a small note that it applies only when billed annually).
• Low platform ratings on review websites like Trustpilot, Sitejabber, App Store, etc.
• Absence of an open and clear refund policy.
• Complex checkout process (e.g., it takes too many steps to pay, or the checkout is not intuitive).
• Technical issues (e.g., long loading times and website crashes).
  

2. Post-Purchase Cancellations:

The incentives to cancel an order after the initial purchase are, on the other hand, slightly different:

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• Unauthorized payments (e.g., auto-renewals without an upfront timely warning).
• Misleading advertising (e.g., when promoted functions are unavailable or non-existent).
• Hidden upsells (e.g., when customers need to pay extra to access some or all of the advertised features).
• Shipping issues (e.g., delayed/long delivery, unexpected fees, or paid shipping instead of promised free delivery).
• Damaged items (e.g., when the product was defective post-production or damaged during shipment).

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Addressing Cancellations at Each Stage

Considering the differences behind the customer reasoning at these two distinct stages, businesses' approaches to addressing and working with these possible issues should also differ. At the pre-purchase point of the customer journey, the main focus should be on building trust. The main ways to do that are by implementing transparent pricing policies and accurate and honest advertising. This will help avoid any possible miscommunications between you and your client base.

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During the post-purchase stage, continuing the communication with your buyers is more critical. Make sure to get in touch and send out information about any possible follow-up payments. Be upfront about the features in your product that might require extra costs. Proactive assistance and transparency help maintain customer satisfaction, minimize losses in sales, and reduce the likelihood of disputes.

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Following this, it’s clear that businesses should have a different approach to their clients during each stage of their journey as they face any confusion and doubts. By adjusting their customer service strategies accordingly, eCommerce businesses can decrease cancellation statistics, improve customer satisfaction, and ultimately establish long-term loyal relationships with their clients.

Customer Support Processes During Cancellations: What Does it Change?

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The origins of high cancellation rates are clear. Still, we need to find out how eCommerce businesses can deal with them. One thing that has proven to be beneficial is establishing an elaborate customer support system. How can it help, exactly? There are a couple of mechanisms through which eCommerce customer support agents can manage buyers’ experience and, therefore, reduce the number of cancellations.

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1. Provision of Quick and Convenient Assistance

Customers want to feel valued by the companies they decide to stick with. For this reason, the easier they can reach out to customer support with their requests, and the quicker the agents handle them, the better. Such urgency and convenience in offering assistance shows them that their questions and concerns are prioritized and managed, lowering the chance of them abandoning the shopping experience altogether.

2. Personalized Request Processing

Even when customers share similar shopping experiences or attitudes, the reasons behind their cancellations can vary. With skilled support agents on the watch, you can make sure that each customer’s request is handled individually, with solutions tailored to address the specific challenges that led to their decision to cancel.

3. Proactivity in Offering Assistance

Customers are naturally drawn to brands that demonstrate attentiveness in addressing concerns and handling queries. By having support agents proactively engage with clients at different stages of their journey and gather feedback about their experiences, your business shows that it genuinely values its customers. This approach boosts satisfaction rates and helps create a smoother, more enjoyable shopping process.

4. Response Clarity

Being upfront with your customers can significantly reduce cancellation rates. Honesty and transparency are key factors in building strong brand communication with consumers. When your support agents address questions directly and clearly, it helps ease any concerns or doubts buyers may have about their purchase, ultimately increasing their trust in your brand from the start. 

5. Feedback Loop

When users cancel, they’re often willing to share what they felt was missing from the product. With a well-organized customer support system, you can gather this feedback through a structured feedback loop and analyze it regularly. The insights can then be passed on to the product team to incorporate user suggestions and develop the product. As a result, your business will have a chance to launch updates that deliver improved features and services and directly address user needs and preferences.

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All of these assistance strategies work to improve client satisfaction and build trust in your business. As such, a strong, well-organized customer support system allows you to effectively address customer concerns about their orders, helping to resolve issues and ultimately encouraging them to keep their purchases and remain loyal to your brand.

Case Example

As part of one of EverHelp’s projects, we enhanced the self-cancellation feature by adding an option for customers to select the reason for their cancellation. This helped us gather and analyze data on the primary factors driving cancellations, which revealed three key issues:

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1. Difficulty accessing information about the product
2. High pricing
3. Confusion about how to use the product’s features

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Subsequently, we could address these concerns directly and personalize the customer experience with these insights. For example, we introduced clear instructions for using materials and features and implemented targeted sales to address pricing concerns. Using data from our support representatives and self-service system, we successfully reactivated some customer accounts and significantly improved the overall user experience. 

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This case is an example of why our EverHelp team highly values a personalized approach to customer support services. Each eCommerce business is different, and the solutions for one company may not fit the other. We tailor our services to the needs of each client to make sure we provide the most effective and cost-efficient services to help them reach their goals. That’s why 87% of our clients stay with us! Aside from that, those who work with us also reach 96% CSAT rates, keeping their business flourishing and customers – satisfied.

Reducing Order Cancellations for Your eCommerce Business Through Customer Support Outsourcing

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Having robust customer support for your eCommerce can do wonders in lowering cancellation rates. Still, don’t rush to hire in-house. Practice shows that outsourcing your support can actually prove to be more advantageous for your business efforts. 

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First, it allows you to have a 24/7 support team ready to assist customers whenever they need help, offering consistent service at all times. Second, outsourcing gives you access to experienced professionals who specialize in handling customer queries, saving you the time and resources that would otherwise be spent on recruiting and training new agents.

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Additionally, most outsourcing providers handle the recruitment process for you, eliminating the need to allocate your resources to hiring. Finally, outsourcing offers flexibility in how you structure your support team. You can work with a dedicated team focused solely on your business or opt for a shared team if your current total order number and volume of customer requests don’t require full-time assistance. This scalability allows you to adjust your support resources as needed, helping reduce costs compared to maintaining a constant in-house team.

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Consequently, outsourcing customer support basically leaves you with the following benefits:

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Of course, working with an outsourced team isn’t all butterflies and rainbows. There are inherent risks in outsourcing support processes, but these can be effectively managed with the right approach. Start by selecting a reputable outsourcing partner with a strong track record and proven experience in the field. It’s also advisable to draft a detailed contract clearly outlining your expectations, requirements, and service standards so all parties are aligned.

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Equally important is maintaining open and consistent communication with your outsourcing partner. Establishing clear lines of contact allows you to address questions or issues as they arise, helping to develop a smooth collaboration and minimize potential disruptions.

Extra Experience-Proven Tips 

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You might wonder which customer support solution will be the most helpful when dealing with cancellations. For starters, we recommend establishing a practical customer assistance team to support your email and on-site chats, as these are the preferred communication channels for most eCommerce customers. Using email, your agents can also send out reminders in case of cart abandonments or yet unpaid orders.

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The next step is to focus on personalizing your customer support approach. This means treating each customer ticket as unique, carefully analyzing individual concerns, and applying retention strategies tailored to each situation. For instance, if a customer’s primary concern is pricing, offering a personalized discount can help retain them. If the issue is technical, your support agents should promptly report and resolve the problem to restore customer confidence.

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Additionally, it’s best to limit the use of chatbots for more complex issues. While AI chatbots can effectively handle simple tasks—like providing product information or guiding customers through return policies—they fall short when addressing the concerns of those customers considering cancellations. In these situations, customers seek personalized, human interaction that makes them feel heard and valued.

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One approach we’ve successfully implemented is combining personalized support with an instant subscription cancellation option. By giving customers the freedom to cancel easily, they feel more in control and are often more open to engaging with support. This builds trust, creating opportunities to offer targeted solutions or special deals that encourage them to stay with the business.

Outsourced Customer Support – Your Next Step Towards Low Cancellation Rates

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Order cancellations are a normal part of eCommerce business operations. Nevertheless, it doesn’t mean that you should just let them happen. Not when there are working solutions that can help your business minimize the number of unsatisfied customers and bring your sales game up. Outsourcing your customer support efforts is a good start. 

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In case you are already thinking about where to look for a partner to match your company's support needs, EverHelp is right here and ready to help! With over five years of experience, our skilled agents know how to address customer concerns, ease doubts, and improve retention.

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Ready to transform the way your clients see your business? Book a free meeting with our team today, and let’s work together to bring your cancellation rates to an all-time low.